Summary: Artificial Intelligence (AI) and Robotic Process Automation (RPA) are rapidly transforming the business landscape. Companies across industries recognize the power of automation. They are readily implementing newly-developed technologies to increase efficiency, enhance productivity, reduce operational costs, build robust and long-lasting customer relationships, and allow internal and external stakeholders to access and share business-critical information on a single platform. SaaS technologies enable investment institutions to offer automated investment accounts, allowing banks to minimize the number of physical branches and retail shops to provide automated shop assistants. This blog will talk about how CFOs can use the power of SaaS technologies to revolutionize their business and become a market-leader.
Today, any function across the business hierarchy can be automated — customer service, financial management, compliance, logistics — and offer massive returns. However, some business pundits argue that the increasing abilities of AI, for example, computerized business forecasting clubbed with rapid data processing, may render humans obsolete. At the same time, optimists say that new technologies will significantly increase the decision-making abilities of humans.
Although organizations understand the benefits of implementing SaaS technologies, a few aren’t ready to board the bandwagon so quickly. The primary question is: When SaaS technologies are automating functions in lower and middle hierarchies, why not in senior management? Let’s discuss this question in light of the existing financial structures across organizations.
It’s hard to believe that CFOs often push for the latest technology trends across the organizational hierarchy. But when it comes to top financial management functions, they will opt for manual methods. But is there any concrete reason why only the finance department should be devoid of the latest technology trends? Are there any hidden advantages of this move? Is it helping reduce expenses or increasing the execution speed of processes and transactions?
The traditional roles of a CFO are business forecasting, improving ROI, decreasing financial risks, preparing critical reports, maintaining enough liquidity at all times, and many more. But manual functions like preparing business reports can be tedious work that eats up much time of the CFO and their team.
A recent PWC global CFO survey tells that 78% of companies are most likely to adopt advanced levels of digitalization by 2020. The global pandemic might have offset the need for immediate implementation of digitalization, but now that the economies worldwide are recovering, companies are showing renewed vigor for implementing SaaS technologies. But you will see a vast difference in how CFOs are responding. They accept that SaaS technologies are automating business functions at the lower and mid-level. Still, they remain silent when it comes to replicating the same success in their domain of influence.
During the COVID era, more than 50% of businesses couldn’t respond effectively to changes brought by incessant lockdowns. The reasons were as follows:
- Companies didn’t have early warning systems, due to which they failed to anticipate the challenges ahead. It reduced their ability to strategize and act quickly to the changes around them.
- According to the Vena Q2-2020 Industry benchmark report, only 48% of companies surveyed have an agile planning process. Moreover, 40% of organizations don’t use scenario modeling because they lack appropriate tools to conduct scenario modeling, agile forecasting, and cash flow management, leaving them with no way to plan for the future.
- 57% of the surveyed professionals in the industrial benchmark report say that disparate and disconnected data pose a severe data challenge, and 48.5% find it challenging to draw valuable insights from their data.
What can CFOs learn?
Business management solutions automate finance processes, instantly finishing time-consuming and repetitive work. This is where RPA plays a significant role as it helps achieve an array of benefits. For example, it helps manage cash flow and maintain business liquidity by automating the process of collecting funds and invoice generation for customers. However, most businesses still rely on manual methods to check and verify the accuracy of billed amounts and ensure the fee is paid within the deadline.
Financial reporting is one of the primary functions of a finance ERP system. Finance automation complements this tool by automating manual functions like external reporting and journal entries. In addition, it streamlines each level in the production process, from the beginning to the end, accelerating the business workflow and eliminating the need to maintain data manually.
While talking about the primary functions of a CFO, Financial Planning and Analysis (FP&A) comes to the fore. Unfortunately, the CFO’s team spends substantial time collecting and formatting data when they should use their time to brainstorm strategies, do better forecasting, and make sound decisions.
Financial planning and forecasting are crucial areas that a company should focus on and learn ways to deal with. Today, business transformation requires a sound digital strategy, and it’s high time CFOs should evolve and board the innovation train.
<<<Also Read: The first 90 days action plan for a new SaaS CFO>>>
The future trajectory for CFOs
As the number of data points — customer and industry sources — increases, companies expect CFOs to execute highly-relevant digital strategies. Reporting on business outcomes is only becoming more complex and strategy-driven with time. In short, the position of a CFO is gradually drifting away from being a generalized one into a specialized one. As a result, CFOs will have to adopt a broader-stroke thinking pattern to establish strategic synergies in the process.
CFOs should understand that resource-heavy manual tasks will become mandatory in the coming times, so eliminating them will not be the right step. If CFOs continue walking on the current trajectory, the functions of CFOs and CEOs will overlap. And the only way to deal with that challenge is by adopting the latest technology trends. An old-school finance mindset will not work in today’s cut-throat competitive age. Instead, CFOs must adapt to recent technology trends at the earliest.
At Sage Software Solutions, we have a vast array of ERP solutions tailored to your business needs. Seamless collaboration and robust automation are the fundamental principles upon which our company is built. If you want to implement an ERP software customized to your needs, then please contact one of our sales representatives and get ready to become a market leader.
